Feds Aim to Cut Paperwork for Mom-and-Pop Banks
Published Date: 11/18/2025
Proposed Rule
Summary
The OCC wants to make it easier for smaller banks—those with less than $30 billion in assets—to get licenses for certain activities. These changes cut down on paperwork and speed up approvals, helping community banks focus more on serving their customers. If you’re involved with these banks, get ready to share your thoughts by January 20, 2026!
Analyzed Economic Effects
5 provisions identified: 5 benefits, 0 costs, 0 mixed.
15‑Day Deemed Approval for Capital Changes
For changes in permanent capital, an application by an eligible bank or covered community bank would be deemed approved 15 days after the OCC receives the application unless the OCC removes the application from expedited review or extends the process under Sec. 5.13(a)(2). A covered community bank may request OCC approval to decrease capital for up to four consecutive quarters by specifying a total dollar amount for the period.
New "Covered Community" Bank Definition
The OCC would create a new category called a “covered community bank or covered community savings association.” To qualify, a national bank or Federal savings association must have less than $30 billion in total assets, not be an affiliate of a depository institution or foreign bank with $30 billion or more in assets, be “well capitalized” under 12 CFR 5.3, and not be subject to a cease-and-desist order, consent order, or formal written agreement that requires actions to improve its financial condition unless the OCC notifies it otherwise in writing.
Faster, Simpler Filings for Community Banks
If your bank qualifies as a covered community bank (under $30 billion, well capitalized, no qualifying enforcement action), the OCC proposes to allow it to use the same expedited or reduced filing procedures that currently apply to ‘‘eligible’’ banks. The changes would apply across many types of filings including charter applications, conversions, branch establishment, fiduciary powers, certain capital changes, business combinations, investments, and operating subsidiary notifications.
Clearer Standard for Extending Review
The OCC would add a sentence saying it considers an adverse comment to raise a "significant" concern if the facts in the comment were previously unknown to the OCC and, if proven accurate, would support denial of the filing. This clarifies when the OCC may extend expedited review or remove a filing from expedited procedures.
OCC Estimates Limited Small-Entity Impact
The OCC estimates the proposed rule would affect up to about 64 OCC-supervised institutions and that the rule would not have a significant economic impact on a substantial number of small entities. The OCC also reports the Licensing Manual information collection (OMB control number 1557-0014) has an estimated total annual burden of 12,481.15 hours and an estimated 3,694 respondents.
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